From the course: Supply Chain Beyond the Basics: Building System Dynamics Models

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Understanding systems thinking

Understanding systems thinking

- [Instructor] Systems thinking is a way of seeing the world around us that focuses on the interconnections and interactions within a system, rather than viewing each part in isolation. It's about seeing the bigger picture and understanding how different elements within a system influence one another. System dynamics is a modeling approach that was originally developed by an MIT professor named Jay Forrester. System Dynamics allows us to capture the ideas we get from systems thinking in simulation models that explain why things happen the way they do, and they help us anticipate things that are likely to happen in the future. One of the ways that we teach people about system dynamics is by using MIT's beer distribution game. There isn't any real beer involved. It's just an example of a very simple supply chain. In the beer distribution game, participants take on the roles of a retailer, wholesaler, distributor, and manufacturer within a supply chain, each managing inventory and…

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